BMW and PSA to review small petrol engine partnership in September 2014

BMW and PSA/Peugeot-Citroen will review their collaboration on small gasoline engines in September 2014, BMW chief executive Norbert Reithofer told Les Echos in an interview. According to Reithofer, the carmakers have yet to decide whether to terminate or extend the partnership, which is due to expire in 2016.

He remarked that BMW and PSA had considered various projects together but that none worked due to their "incompatible product renewal cycles." Reithofer has remarked that BMW no longer needs PSA's assistance since it is now developing its scalable engine architecture for three-, four- and six-cylinder gasoline as well as diesel engines that would allow it to keep costs at low levels.

Les Echos, citing a source close to the German carmaker, reported in September that BMW and PSA had decided against extending the engine partnership.

Once the collaboration expires, BMW and PSA will have to end a joint project commenced in 2002, when the carmakers inked an agreement to jointly develop and produce up to 1 million small gasoline engines.

The carmakers later added plans to build components for hybrid electric-gasoline systems. They unveiled the hybrid project in 2012 after PSA and General Motors commenced setting up a partnership early that year. The engines are being fitted in BMW’s MINI brand and in PSA’s mid-range vehicles.